Employment-oriented MSME promotion - Boosting private enterprise as an engine for job creation

Project name: 

Employment-oriented MSME promotion

Commissioned by: 

German Federal Ministry for Economic Cooperation and Development (BMZ)

Partners: 

Ministry of Industry, Trade and Supply, Ministry of Tourism and Antiquities, Ministry of Information and Communications Technology, chambers of industry and commerce, business associations, relevant service providers, local administrations within the regions, civil society

Duration: 

2018 - 2022

The challenge:

Jordan’s economy is dominated by a strong public sector. Traditionally the largest employer, accounting for 41% of the workforce, the public sector has seen a massive decline in recruitment in recent years. Latest official statistics indicate an unemployment rate of 18.3% in 2017. At the same time, Jordan's private sector provides opportunities for growth, innovation and employment. Jordan’s density of micro, small and medium enterprises (MSMEs) is considerably lower than in other higher middle-income countries. MSMEs often fail to compete with foreign companies, partly due to a lack of qualified personnel and limited access to business development services. In addition, protracted registration and approval procedures as well as a rigid legal framework make it hard to establish new enterprises and to invest in MSMEs in Jordan.

Our approach:

The project 'Employment-oriented MSME promotion' aims to support Jordanian MSMEs in accordance with 'Jordan 2025 – A National Vision and Strategy' and the 'Jordan Economic Growth Plan 2018-2022'. It does so by focusing on food processing, information and communication technology (ICT), and tourism as sectors with considerable growth and employment potential. The project supports the implementation of sectoral and market strategies to boost the prospects of MSMEs and the sectors altogether. Specifically, the project aims at improving enterprise competitiveness, enhancing the competences within MSMEs and improving the business and investment climate in the selected sectors. Another goal is to support partner organisations to develop information platforms that improve access to financial and non-financial services for enterprises in Jordan. Furthermore, the project will facilitate public-private dialogue, encouraging the active involvement of relevant stakeholders and helping to identify barriers to employment-oriented MSME growth.

The benefits:

MSMEs are crucial for the Jordanian economy and labour market: of the 160,000 registered businesses in the country, more than 90% are micro enterprises. By enabling companies to increase their competitiveness and create more job opportunities, the project ultimately targets jobseekers, entrepreneurs and employees of Jordanian MSMEs. A special focus is placed on young people entering the job market as well as women. Improving the conditions under which MSME operate as well as the offer of services and skills they require, should also encourage entrepreneurs to start their own businesses, leading to a higher density of MSMEs and to employment-intensive growth. On an institutional level, the project strengthens the capacities of key partners to provide relevant services and promote policies that improve the business-enabling environment for MSMEs.

The project is part of a special initiative designed to stabilise and promote development in North Africa and the Middle East run by Germany’s Federal Ministry for Economic Cooperation and Development (BMZ). Through the projects that make up this special initiative, BMZ is helping to open up economic and social prospects for people in the region. Within this context, more than 70 additional development cooperation projects are implemented in the period from 2014 to 2022. The thematic focus is on youth and employment promotion, economic stabilisation, democracy and stabilising neighbouring countries in crisis situations.